Why talk of Nintendo's Switch-led turnaround may be premature

The Nintendo Switch may very well go on to become one of the most successful game consoles ever in the long term. KAZUHIRO NOGI/AFP

As product launches go, it’s hard to top the Nintendo Switch. With 4.8 million units sold in the United States since March last year, it is now the fastest-selling video game console ever in the country, the Japanese company announced last week.

With more than 10 million units sold globally, that’s an unquestionably enviable first year.

Nintendo shares have soared as a result, beginning 2018 at ¥42,530 on the Tokyo Stock Exchange, nearly double their value a year ago. Analysts are effusive: “Nintendo has managed to completely turn around its business,” IHS Technology’s Piers Harding-Rolls told the BBC.

There is no doubt 2017 was a great year for the company. But calling it a full turnaround is probably premature – especially considering another piece of related, but less-heralded news that also emerged last week.

In stark contrast to Nintendo’s jubilant announcement, Microsoft quietly confirmed that it has ended production of an adapter that allows newer Xbox consoles to work with its Kinect peripheral.

The motion-and-gesture-sensing device itself was officially discontinued in October; but killing off the adapter now represents the final nail in its coffin. The irony is hard to miss.

Back when it was first released in 2011, Kinect set the gaming world on fire.

Consumers were excited about the new possibilities, as its voice-and-full-body motion detection supplanted traditional controls. The future of video games looked to be populist, where anybody could participate without having to learn how to use a complicated handheld controller.

Microsoft moved more than 10 million units within six months of release as a result, capturing the Guinness World Record for the fastest-selling consumer electronics device in the process.

But the initial excitement soon died down as it became clear that Kinect wasn’t very accurate in measuring motion or voice. Third-party game publishers also opted to steer clear of it because the resources required to design for it were too onerous, and the returns were questionable.

Six years later, like so many promising yet ultimately unfulfilling gadgets, Kinect is ultimately a short-lived novelty in the dustbin of history.

The Nintendo Switch may very well go on to become one of the most successful game consoles ever in the long term; but at this point it still bears some similarities to Kinect.

Aside from its initial success, there’s also its novelty. With its ability to serve as both a home console and a portable gaming device, the Switch similarly promises a new way to play. Many gamers who have purchased it love it for that fact.

But that novelty could undermine its long-term chances.

Much of the Switch’s momentum so far can be attributed to a pair of smash hits, Legend of Zelda: Breath of the Wild and Super Mario Odyssey. Both are receiving universal praise as two of the top video games of 2017. Both are also first-party titles developed internally by Nintendo.

The company has a few more big first-party titles lined up for 2018, including Switch debuts for its popular Kirby and Yoshi characters. But it will soon run into the inalienable fact that great games take many years to create.

Nintendo is unlikely to be able to deliver such games at a rapid clip on its own, which is why every console maker needs to have many hands on deck.

Missing so far from the Switch, as they have been for most of this millennium on Nintendo’s previous three consoles, are the big, original blockbuster games developed by third-party publishers.

The likes of Activision, Electronic Arts and Ubisoft are so far offering only marginal (if any) interest in the Switch, despite its early success. They’re resistant either because they were burned on poor sales of Nintendo’s previous consoles, or the Switch – like the Kinect – is too different, and requires too many fresh development resources.

Strong sales and a big user base are a good way to get them interested; but that didn’t help in the case of the Wii. Released in 2006, the Wii also set records with 4 million units sold in the US in its first 10 months, and more than 100 million units through its entire run.

But without third-party support, Wii owners tired of its novelty and their consoles ended up collecting dust, much like Microsoft’s Kinect.

The Switch has had a great start, but it could be destined for the same fate without a wide array of quality third-party games. It’s too early to declare it a success and it’s too soon to consider Nintendo a turnaround story, since the momentum it built in 2017 could very easily fizzle in 2018.

The potentially parallel trajectories of the Kinect and the Switch are particularly poignant as the Consumer Electronics Show gadget extravaganza unfolds in Las Vegas this week.

The hype for all manner of new gadgets – from voice-controlled appliances to augmented reality glasses – will be in high gear at the show, which means it’s a good time to remember that success in electronics is a long game, not a short-term novelty.

Peter Nowak is a veteran technology writer and the author of Humans 3.0: The Upgrading of the Species